Dax Down 2% As Stocks Tumble On Trade War Concerns

(RTTNews) - A day after hitting record highs, German stocks are deep down in negative territory Tuesday morning amid rising worries about a global trade war and its impact on growth, as new U.S. tariffs on Mexico, Canada and China become effective today.

Adding to the woes, U.S. President Donald Trump reiterated that he will impose reciprocal duties with effect from April 2, and the first target will be a levy on agricultural products.

In retaliation, Canada announced 25% tariffs on $107 billion worth of U.S. goods, with $20.7 billion in immediate effect. Mexican President Claudia Sheinbaum said her country is preparing countermeasures.

China has announced 15% tariffs on U.S. chicken, wheat, corn and cotton, plus 10 percent cent tariffs on soybeans, pork, beef and dairy beginning March 10.

The benchmark DAX was down 466.46 points or 2.02% at 22,672.05 a little while ago.

Defense stocks are finding some support as European Commission President Ursula von der Leyen unveiled a rearmament plan capable of mobilizing about 800 million euros for Europe.

Continental is plunging nearly 9%. The company announced that it expects limited improvement to profitability this year.

Fresenius Medical Care is down 7.6%. Daimler Truck Holding, BMW, Deutsche Bank, Siemens Energy, Mercedes-Benz, Heidelberg, Volkswagen, Commerzbank, Siemens, BASF, Porsche, Infineon and Adidas are down 3 to 6%.

Zalando, Deutsche Post, Brenntag, SAP, Bayer, Qiagen, Deutsche Telekom and Allianz are also notably lower.

Rheinmetall is rising nearly 2%. MTU Aero Engines is gaining about 1.5% and E.On is up 1.3%. Deutsche Boerse, Vonovia and Henkel are modestly higher.

On the economic front, data from Eurostat said the unemployment rate in the euro area remained flat at 6.2% in January.